KUALA LUMPUR (Feb 14): Food processing group HB Global Ltd plans to undertake a private placement to raise about RM23.1 million to fund future investments and for working capital purposes.

The group said the placement entails the issuance of up to 154 million shares, representing 20% of its issued shares of 770 million as at Jan 26, 2022.

"The placement shares will be issued based on a discount of not more than 20% to the volume-weighted average market price of HB Global shares for the five market days immediately preceding the price-fixing date," it added.

In a filing with Bursa Malaysia, HB Global said that based on an illustrative price of 15 sen per placement share, the group will raise about RM23.1 million.

The group said it has earmarked RM12.85 million of the proceeds for the funding of future projects, acquisitions or investments in other complementary businesses or assets.

"We expect the acquisition or investment to be within the food processing business segment, such as those relating to the processing, packaging and producing of variety ready-to-serve foods, as these businesses are deemed beneficial and are complementary to the group's existing businesses," said HB Global executive director Keh Chuan Yee.

The group added that another RM10 million of the proceeds will go towards working capital.

HB Global's share price closed half a sen or 2.7% lower at 18 sen, giving the group a market capitalisation of RM134.96 million.